Energy Bangla

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Dhaka Tuesday,  Jan 22, 2019

Last Twelve Months Challenging For Mining Sector

EB Desk

GCM Resources plc Chairman Michael Tang said, the last twelve months have been challenging for the junior mining sector as commodity markets continue to deteriorate and raising new funding has become particularly difficult for any mining company that is not producing.

In contrast to the decline in global demand for coal, Bangladesh, where GCM’s operations are located, is expected to

see a significant increase in demand for high quality thermal coal in-country as the Government continues to

restructure the country’s power sector towards coal. The Bangladesh Government plans to generate over 19,000MW

from coal by 2030, and is currently considering coal-fired power plants with a combined generation capacity of

13,316MW. While the current plans assume coal is imported there is a strong case for the country to use its own

indigenous resources.

The Company agreed a two year, £3 million convertible loan facility on 29 May 2015 which may be drawn down as

and when required and will assist in financially supporting GCM’s activities as it continues to pursue approval of the

Phulbari Coal Project (the Project). As at 30 June 2015 GCM had drawn down £0.2 million from the convertible

loan facility (£0.51 million as at 19 November 2015). While achieving approval continues to be a challenge, the

Board believes that it is in the best interests of all stakeholders that the Project is developed. To this end the Board’s

strategy is to present the Project to the satisfaction of the Government of Bangladesh and to secure an agreement that

meets the objectives of both parties.

Understanding the importance of local community support the Company has continued its engagement activities

throughout the year, retaining a working relationship with community leaders and understanding the views of local

residents from a diverse range of backgrounds. The Company has met around 2,500 people since it first started its

re-engagement activities in late 2012.

Finally, we saw the successful closure of the OECD examination on 10 September 2015 after a thorough and

impartial examination which first started in December 2012. I reiterate our commitment that the Project developed

by GCM will be undertaken with integrity and fairness for all stakeholders, and in adherence to the highest

international and national environmental and social standards. The Project can be a catalyst for economic growth

and social development both within the region and throughout the country and I look forward to making progress

towards its implementation for the benefit of all stakeholders.

Our financial results reflect our focus on keeping costs under control while pursing Project approval. The Group

incurred a loss of £0.9 million for the year ended 30 June 2015 compared to £1.3 million last financial year and £3.2

million in 2013. Project related expenditure of £0.6 million for the year was also kept at a minimum (2014: £0.8

I would like to thank the Board and staff for all their hard work over the last twelve months and to the shareholders

for their continued perseverance and support during these challenging times.

The Income Statement, Statement of Comprehensive Income, Statement of Changes in Equity, Balance Sheet and

Cash Flow are presented on the following pages.

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